Institutionalized Mindsets of Invulnerability: Differentiated Institutional Fields and the Antecedents of Organizational Crisis [*].

Publication: Organization Studies

Publication Date: 01-JUL-01

Bookmark this article Print this article Link to this article Email this article Digg It! Add to del.icio.us RSS

COPYRIGHT 2001 Sage Publications, Inc.

Abstract

Building on Scott's (1995) institutional theory framework, this article uses a microinstitutional approach to develop a model of the institutionalization of mindsets in a differentiated institutional field. This model is grounded in textual data involving the 1992 explosion at Westray Mines, illustrating how regulative, normative and cognitive elements contributed to the institutionalization of a harmful mindset of invulnerability that clouded individual perceptions of the inherent risks in daily work practices. This process culminates in organizational crisis.

Descriptors: organizational crisis, institutionalization, institutional field, coal mining

Introduction

'It was clear from the outset that the loss of 26 lives at Plymouth, Pictou County, in the early morning hours of 9 May 1992 was not the result of a single definable event or misstep. Only the serenely uninformed (the willfully blind) or the cynically self-serving could be satisfied with such an explanation.' (Westray Mine Public Inquiry 1997: viii)

On 8 May 1992, an explosion at the Westray mine in Nova Scotia killed all 26 men working underground. In an economically depressed part of Canada where coal mining had been a way of life for many generations, the eight months that Westray had been in operation was controversial to say the least, and the mine had been the centre of many political disputes between regional and provincial governments. Construction of perhaps the most dangerous coal mining facility in the world was expedited to meet the publicly made promises of mine officials, while compromizing safety at just about every step along the way. What makes the Westray explosion particularly significant is the fallout that has resulted: charges of manslaughter and criminal negligence causing death brought out against the mine's developer and two former Westray managers; the political career of one of Westray's biggest supporters, the premier of Nova Scotia, cut short; the bankruptcy of Westray's parent company, Curragh; thousands of people thrown out of work at a time when unemployment in Canada was at a record high; and shareholders left with worthless stock certificates (Jobb 1994).

In this article, I develop a model of the institutional forces contributing to organizational crises. Based on a case study, I build up an argument that, at Westray, an institutionalized mindset of invulnerability had arisen through a complex network of influences on the organization and its members. This finding is fundamentally different from the ways in which past scholarship has understood organizational crises, because, in this article, I focus on the micro-level institutional elements that contribute to a mindset of invulnerability, where individuals were willing to take unprecedented risks. The events directly causing the Westray explosion are very easy to identify, a deadly combination of coal dust, methane gas and sparks. The organizational and contextual factors that contributed to the regularly occurring unsafe practices were, however, much more complex, and not solely a function of unmitigated greed and the pursuit of a corporate agenda (e.g. Jobb 1994).

Theoretical Explanations of Organizational Disasters

Extant theorizing on the causes of organizational crises suggests a number of activities or situations that seem to predict inevitable disaster. Turner' s (1976) work was foundational in this regard, directing attention towards the organizational factors at the root of social disasters, especially those that are avoidable to a certain extent. This early work tended to attribute crises to faulty premises, poor communication and misplaced optimism. Gephart (1984) extended these notions by introducing politics into the processes by which perceptions occur, adding another dimension to the cognitive processes that tended to be blamed for organizational disasters. Shrivastava et al. (1988) identified an interaction of organizational and environmental 'failures' that culminate in a crisis, yet left this interaction theoretically underdeveloped in terms of predicting when, where or why these interactions would occur. Perrow's (1984) theorizing of 'normal accidents' focused on organizational coupling and interactive c omplexity, predicting the greatest catastrophic potential (even an inevitable accident) when organizational processes are both complicated or unpredictable, and when they occur rapidly and are interrelated. Within this framework, mines are neither particularly accident-prone nor largely immune to accident. Pauchant and Mitroff (1992) constructed a model to determine the extent to which an organization is crisis-prone, examining the organization at the levels of strategy, structure, culture and individual character. Within this framework, it is 'faulty management' at any or all of these levels which makes an organization crisis-prone, a situation that they suggest is both predictable and preventable. Weick (1993) also pointed to vulnerability in organizations, but examined individual sensemaking activities instead of organizational structures and cultures. Particularly in minimal organizations, individuals can be susceptible to a sudden loss of meaning as a result of unanticipated events or surprise. The conse quence is a sequence of events that heightens anxiety, making it increasingly difficult for organizational members to make sense of what is happening. These events portend disaster, as individuals are rendered incapable of making proper decisions. Prasad and Hynes' (1997) examination of the Westray explosion illustrated how crises occur in less complex organizational systems by examining overt organizational non-compliance, the hallmark of mock bureaucracy (Gouldner 1954). They argued that a bureaucratic pattern emerged whereby managers and workers came to hold no legitimacy for rules that existed, that safety guidelines had 'little intrinsic value' and non-compliance would result in 'few negative consequences'. This not only presents a rather dim view of the responsibility and concern that workers had for their own lives and those of their families, but also receives only mixed support from more recent evidence that is now publicly available in the Westray Mine Public Inquiry (1997). Finally, Vaughan (1996) focused on a 'sociology of mistake', illustrating how social structures of the organization itself systematically produce error and disaster. This approach shares Prasad and Hynes' interest in rules, but identifies how rules changed over time (rather than those that were violated) becoming problematic by gradually including more risk. This 'normalization of deviance' became embedded in the daily practices of organizational members, gradually changing notions of 'acceptable' and 'unsafe' behaviours. From this perspective, it is a nexus of structural and cultural factors that result in harmful outcomes, despite organizational efforts to the contrary.

The argument I build in this article uses an institutional framework to identify how regulative, normative and cognitive pillars of institutions (Scott 1995) created a re-inforcing set of institutional expectations that encouraged a harmful mindset to institutionalize. In industries such as underground mining, this can have catastrophic consequences; in many industries, however, they can easily go unnoticed. Dissatisfied with the ability of extant theoretical explanations of organizational crises to describe the events leading up to the Westray explosion, I undertook a study seeking to understand how and why so many people were 'willing' to routinely face such major risks. In the popular press, greed was frequently cited as the cause of the explosion, but surely greedy mine owners would have done everything possible to keep the mine in production in order to maximize their profits. Explanations based on rational actor frameworks are usually rooted in organizational calculations to engage in risky activities, embodied in an amoral calculator hypothesis (Kagan and Scholz 1984) that presumes that organizations are aware of the risks they face and make decisions to safeguard against them (or not) in an instrumentally rational way. This hypothesis did not make sense in Westray's case. Increasingly, we are seeing organizations operating in highly institutionalized contexts, and, as a consequence, seeking to secure legitimacy in their wider social structure in order to enhance their chances of survival (Tolbert and Zucker 1983). From an institutional perspective, behaviours can be understood in terms of conformity with what powerful institutions define as appropriate, independent of the 'real' impact on the organization (Meyer and Rowan 1977). My findings show that a mindset of invulnerability developed as a result of (i) regulative aspects of the institutional environment backed by powerful sanctions, (ii) normative rules manifest in multifaceted social obligations, and (iii) cognitive elements creating constitutive ru les that were obeyed because they formed the basis of individuals' social identities as coal miners and as men. Despite the specific context of this case study, there are much broader implications for understanding how dysfunctional and potentially harmful organizational behaviours can occur as a result of a differentiated institutional field consisting of multiple institutions exerting influence on organizations and their members.

I wrote this article to achieve two research objectives, first to identify the factors that contributed to the Westray mine explosion and second to examine the effects of micro-level institutional processes. More specifically, I address two gaps in scholarship that inform our understanding of crises and institutionalization. First, I deal with the inadequacy of the ways in which organizational crisis has been theorized. Although a great deal of scholarly attention has been paid to the catastrophic potential of organizations, none were able to explain the Westray explosion. Part of the reason for this is the absence of institutional analysis in the study of organizational crisis, creating conceptual lacuna in the theorizing of the causes of crisis. If organizations need to attend to the demands of their institutional environments (DiMaggio and Powell 1983), if most organizations operate in highly institutionalized contexts (Meyer and Rowan 1977) and if these institutions serve to constrain organizational activ ity (Barley and Tolbert 1997), then institutional arguments will improve the explanatory potential of the ways in which crisis is theorized. Institutional theory is primarily concerned with cultural/social behavioural influences (Barley and Tolbert 1997), highlighting a set of external influences on behaviour that rational actor models typically ignore. From this perspective, institutional constituents construct rules and norms that provide legitimacy when complied with. Legitimacy is gained not only from adhering to these institutional expectations, but also from acting consistently with taken-for-granted norms and beliefs that render them 'the only conceivable, obvious or natural' behaviours (Oliver 1991: 148). I address this inadequacy in crisis theorizing by using a perspective that highlights the way crises can culminate from the mundane dally practices encouraged by powerful institutions. Second, I address the incompleteness of the ways in which processes of institutionalization have been investigated. Many institutionalization studies attempt to show the diffusion of practices across an institutional field (e.g. Galaskiewicz 1985; Tolbert and Zucker 1983; Zucker 1988), resulting in the isomorphism that enhances organizational effectiveness and survival (DiMaggio and Powell 1983). Very little institutional research examines the ways in which these practices come to be viewed as legitimate in the first place, instead it focuses on the effects of their adoption across the collection of relevant actors that constitute the institutional field (Zucker 1987). I use a micro-level institutional approach to extend our understanding of institutionalization by treating it as a process of interest in its own right, rather than as an end-state predictive of organizational structure (Tolbert and Zucker 1996). The lack of research on micro-level institutionalization, the role of various types of institutions in this process and the potentially harmful outcomes associated with it, all suggest the need for further theoretic al development in this area.

The Pillars of Institutions

Institutional theory has highlighted organizational motives to acquire social acceptability by conforming to the rules and norms of the institutional environment (Meyer and Rowan 1977; DiMaggio and Powell 1983). The term 'institution' refers to regulatory structures, governmental agencies, laws, courts, professions, interest groups and public opinion (Oliver 1991) that are able to exert pressure on organizations and their members. These institutions come to create rules and expectations concerning appropriate actions for organizations and individuals that may or may not have immediate efficacy (Meyer and Rowan 1977). These exogenous influences form the basis for why taken-for-granted expectations about appropriate behaviour, resulting in exterior and objective constraints that are independent of particular organizational members, appear natural (Zucker 1977). Institutions define, therefore, what is appropriate in an objective sense, and consequently render other acts unthinkable. Rather than focusing solely o n efficiency seeking behaviour, institutional theory is concerned with cultural or social influences on organizations that promote survival and effectiveness through a variety of mechanisms. It is these mechanisms that Meyer and Rowan (1977) suggested were mythical, but were incorporated by organizations in order to gain legitimacy, resources and survival. One of the main reasons for the increasing prominence of the institutional school is the dissatisfaction with theories that virtually ignore cultural influences and venerate efficiency as motives of organizational decision making (Barley and Tolbert 1997). Indeed, this is the case with organizational crises -- conscious, instrumental calculations of risk and return are increasingly unable to explain these phenomena. From an institutional perspective, attention is directed to the rules, norms and beliefs that influence organizations and their members. The structures, process and mindsets that become taken for granted are either not subjected to scrutiny at a ll, or are scrutinized and judged as suitable or appropriate (Jepperson 1991). We can therefore understand organizational crises more fully by finding out what was institutionalized in this context, i.e., which activities, beliefs and attitudes acquired a rule-like status (Meyer and Rowan 1977), thereby becoming resistant to scrutiny and change (Oliver 1992; Zucker 1977).

In this article, I focus on Scott's (1995) three pillars of institutions, i.e., the varying emphases that different institutional approaches place on aspects of the organization and the institutional environment. Rather than illustrating one institutional approach through a case study, I show how a firm can experience institutional pressure from a variety of sources simultaneously. I argue that these institutional pressures are at the heart of the Westray explosion through the creation of individual mindsets of invulnerability that resulted from the compounding institutional pressure in the direction of deprioritizing workplace safety. Because each institution gives rise to legitimacy of a certain type, it is important to track the influence of the institutions constituting the field in which Westray operated, i.e., the 'totality of relevant actors' (DiMaggio and Powell 1983: 148) with which the organization interacts. In this study, I isolate the different types of institutional influence in order to determi ne their impact on the institutional practices at Westray.

Although institutions usually constrain firm behaviour, they also provide 'stability and meaning to social behaviour' (Scott 1995: 33). The various actions in which individuals engage, and which organizational structures formalize, are thus a combination of cultural- and power-based processes that acquire their formative potential through a perception of objectivity or naturalness that prevent the institution from being subject to constant scrutiny. In other words, different processes give rise to different types of legitimacy, defined as a condition reflecting 'cultural alignment, normative support, or consonance with relevant rules or laws' (Scott 1995: 45). Because institutions influence organizations and...

Read the full article for free courtesy of your local library.